Buy Piramal Enterprises, target price Rs 2615: ICICI Securities

ICICI Securities has buy call on Piramal Enterprises with a target price of Rs 2615. The current market price of Piramal Enterprises is Rs 1719.75. Time period given by analyst is one year when Piramal Enterprises Ltd. price can reach defined target.

Piramal Enterprises Ltd., incorporated in the year 1947, is a Large Cap company (having a market cap of Rs 40572.83 Crore) operating in Diversified sector.

Piramal Enterprises Ltd. key Products/Revenue Segments include Interest, Pharmaceuticals, Income From Financial Services, Dividend, Other Operating Revenue for the year ending 31-Mar-2021.



Financials
For the quarter ended 31-03-2022, the company reported a Consolidated Total Income of Rs 4401.03 Crore, up 8.21 % from last quarter Total Income of Rs 4067.19 Crore and up 23.42 % from last year same quarter Total Income of Rs 3565.98 Crore. Company reported net profit after tax of Rs -37.42 Crore in latest quarter.

Investment Rationale
PEL has outlined its 5-year aspirations, which target to: 1) double the AUM in 5 years, 2) grow retail disbursements at 40-50% CAGR over 5 years, and 3) take retail share in total portfolio mix to ~60-70%. Given the movement into stage-2, the brokerages are now building in higher credit cost as well as elevated cost base. It revises SoTP-based target price to Rs2,615 (earlier Rs3,016) and maintain BUY. Factors that pose risk to estimates: i) any further signs of stress in non-RE portfolio, ii) slower than expected growth trajectory.

Promoter/FII Holdings
Promoters held 43.49 per cent stake in the company as of 31-Mar-2022, while FIIs owned 35.03 per cent, DIIs 8.44 per cent.